– Thirty-six municipal bond underwriters operating in the $3.7 trillion muni market will collectively pay about $9 million to settle civil charges over fraudulent offerings, as part of the first pact of its kind with U.S. regulators.

The Securities and Exchange Commission said Thursday that the charges stemmed from a March 2014 invitation to brokers and bond issuers to voluntarily report disclosure violations in offering documents, such as material misstatements and omissions.

“[It is] putting everyone on notice here that if there was any laxity on disclosure in the past it won’t be tolerated in the future,” said Richard Ciccarone, head of Iowa-based Merritt Research Services.

The cases were the first under the program intended to increase transparency in a lightly regulated sector.

Andrew Ceresney, head of the SEC’s enforcement division, said the firms represented about 70 percent of the dollar value of all municipal bonds issued in the United States during the four years ended on Sept. 30.

Among the firms charged include units of banks such as Bank of America Merrill Lynch, BNY Mellon, Goldman Sachs, Citigroup, JP Morgan, Royal Bank of Canada and Morgan Stanley. All have agreed to settle the charges without admitting or denying the allegations.

In exchange for self-reporting, issuers and underwriters were told they would receive favorable settlement terms.

The deadline for underwriters to self-report was in September, and the SEC first charged a bond issuer under the program in July.

Some argued that the SEC measures did not go far enough.

“It requires some self-policing on a go-forward basis … but what stops this from happening again?” said David Tawil, President of hedge fund Maglan Capital, who called the penalties “de minimis.”

A Citigroup spokesman said the company was pleased to resolve the matter, while representatives of the other banks declined to comment.

Academics and industry experts said they believed the SEC’s actions could help spur better disclosures in the market.

“The municipal bond market for many years has been criticized for its opaqueness,” said Andrew Clinton, president of Clinton Investment Management.

The settlement requires each firm to pay civil penalties based on the number and size of the fraudulent offering. The maximum penalty is $500,000 for large firms and $100,000 for smaller ones.

The firms also must hire independent consultants to review their policies and procedures.